Jimmy Carr has apologised for a ‘terrible error of judgment’ relating to his tax arrangements, specifically relating to the controversial K2 scheme, that
David Cameron condemned as ‘morally wrong’.

Jimmy Carr has apologised over his tax arrangements (Picture: PA)

The comedian released a statement saying he was no longer using a legal Jersey-based tax avoidance scheme that saw him pay income tax of just one per cent.

The Times newspaper revealed the 39-year-old tax arrangements this week, saying he had sheltered £3.3million a year through the scheme before it was returned to him in a non-taxable loan.

As well as condemnation from the prime minister Mr Carr also came in for criticism due to his lampooning of fat cat bankers in his stand-up routines.

‘I appreciate as a comedian, people will expect me to “make light” of this situation, but I’m not going to in this statement as this is obviously a serious matter,’ he wrote on Twitter.

‘I met with a financial adviser and he said to me “Do you want to pay less tax? It’s totally legal.” I said “Yes.”

‘I now realise I’ve made a terrible error of judgement.’

Mr Carr continued: ‘Although I’ve been advised the K2 tax scheme is entirely legal, and has been fully disclosed to HM Revenue and Customs.

‘I’m no longer involved in it and will in future conduct my financial affairs much more responsibly. Apologies to everyone.’

At a gig in Tunbridge Wells, Kent, Mr Carr had earlier said: ‘I pay what I have to and not a penny more.’

David Cameron criticised Jimmy Carr’s tax affairs (Picture: PA)

Mr Cameron branded Mr Carr ‘morally wrong’ because fans were paying for shows to watch a comic not paying taxes in the same way that they did.

‘I think some of these schemes – and I think particularly of the Jimmy Carr scheme – I have had time to read about and I just think this is completely wrong,’ he said during a round of interviews at the G20 summit in Mexico.

But the prime minister refused to take that bait to criticise Gary Barlow , who along with Take That band-mates Howard Donald, Mark Owen and manager Jonathan Wild, has been accused of investing at least £26million in a scheme run by Icebreaker Management Services to avoid paying millions to the HMRC.

‘I am not going to give a running commentary on different people’s tax affairs. I don’t think that would be right,’ he said at a Downing St press conference.

‘I made an exception yesterday because it was a very specific case where the details seemed to have been published and it was a particularly egregious example of an avoidance scheme that seemed to me to be wrong and I made that point.’

Shadow leader of the house Angela Eagle said: ‘Oddly, [Mr Cameron] did not take the opportunity to condemn as morally repugnant the tax avoidance scheme used by Conservative supporter Gary Barlow, who has given a whole new meaning to the phrase Take That.

‘If he is also morally repugnant, why has he been given an OBE in the Birthday Honours?’

She added: ‘Why is the prime minister’s view of what’s dodgy in the tax system so partial? Sir Philip Green has interesting tax arrangements but far from being labelled morally repugnant in a Mexico TV studio, he has got a government review to head up.’